Salary Sacrifice Calculator
Salary sacrifice is when you agree to receive part of your pay as a benefit instead of cash, reducing your taxable income. This calculator shows how that affects your take-home pay and KiwiSaver.
Salary sacrifice is when you agree to receive part of your pay as a benefit instead of cash, reducing your taxable income. This calculator shows how that affects your take-home pay and KiwiSaver.
| Income & deductions | ||
| Gross income | ||
| Salary sacrifice | — | |
| Taxable income | ||
| PAYE (income tax) | ||
| ACC earners levy | ||
| Your KiwiSaver | ||
| Net take-home income | ||
| After benefit cost | — | |
| KiwiSaver contributions to fund | ||
| Your contribution | ||
| Employer contribution (net of ESCTEmployer Superannuation Contribution Tax - the tax your employer pays on their KiwiSaver contribution. The rate depends on your income level.) | ||
| Total to KiwiSaver | ||
| ESCT rate | ||
Salary sacrifice and tax
When you salary sacrifice, your taxable income drops. This means you pay less PAYE (income tax) and ACC levy - which is the source of the benefit. The sacrifice amount comes out of your gross pay before tax is calculated.
The KiwiSaver effect
Both your employee KiwiSaver contribution and your employer's contribution are calculated as a percentage of your taxable income. A lower taxable income means less going into KiwiSaver each pay cycle - from both sides.
PAYE vs ESCT
PAYE is the tax on your salary. ESCT (Employer Superannuation Contribution Tax) is the tax on your employer's KiwiSaver contribution. At certain income levels, ESCT is lower than PAYE - which means sacrificing into KiwiSaver can be more tax-efficient than taking the income as cash.
Total remuneration contracts
Most employees are on a pay + benefits arrangement, where the employer KiwiSaver contribution is paid on top of your salary. Some employees have a total remuneration contract, where the employer contribution is included within the agreed salary package - meaning less take-home pay.